Xbox CEO Phil Spencer Describes Layoffs As "Sad," But Necessary For "long-Term Prosperity"

Xbox head Phil Spencer said in an email to Microsoft’s gaming staff that while layoffs “hurt,” they are ultimately in the company’s best interests. An employee shared the email with Kotaku(opens in a new tab).

“This is a difficult time for our company, and the decisions we made this week were difficult ones,” Spencer added. The Gaming Leadership Team had to make choices that, in our opinion, would pave the way for the long-term success of our products and company, but the consequences for each individual are real.

I’m aware it hurts. We appreciate your assistance in helping our coworkers adjust to these changes. For teams that attend the Monthly Gaming Update next week, we will have numerous opportunities to engage and address your concerns.

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I am also in close contact with groups at ZeniMax to offer help. I’m determined to be as open and honest as possible with the GLT. It can be challenging to move forward when there is uncertainty, but I am optimistic that we can get through this trying period together.

Two days after Microsoft announced that 10,000 employees would be let go worldwide, Spencer sent an internal email. (Opens in new tab) Microsoft did not identify where the cuts were occurring.

Yesterday’s announcement that Microsoft will be laying off more than 10,000 workers, like similar recent announcements at other companies, highlights the growing need for tech workers to organize and lock in meaningful worker protections. 1/

— CODE-CWA (@CODE_CWA) January 19, 2023

Still, according to a Bloomberg article, the gaming business of Microsoft—which houses companies like Bethesda Softworks and 343 Industries—would be impacted. A day later, Patrick Wren, a former senior multiplayer designer for Halo Infinite, essentially corroborated that information.

Wren stated that Halo Infinite “should be in a better position” and that the layoffs “shouldn’t have happened.” “The cause of both of those things is inept leadership at the top during the creation of Halo Infinite, which put tremendous stress on people working hard to make Halo the best it can be,” the statement continues.

The dismissal of 10,000 employees cannot be directly attributed to poor decisions made by 343 management, but Wren’s remarks were, at the very least honest and emotional. In contrast, Spencer’s speech seems to have been carefully planned to be merely calming without saying anything.

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Thanks to your work in support of players, creators, and one another, Xbox has a long history of success. In these times of change, your effort is greatly respected and appreciated and is essential to the growth of our company.

I want to thank you for everything you do here because I am glad to be a member of this team, and I am optimistic in our future, but I am also aware that this is a difficult time.

The ZeniMax Workers United/CWA union, the first game studio union at Microsoft and, for the time being at least, the most significant game industry employee union in the US, was formed just a few weeks before the announcement of layoffs.

The Communications Workers of America union said in a statement(opens in new tab) that such workers might be given at least some protection during the layoff procedure.

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